Mrs. SHAHIDA ANWAR VS DEPUTY COLLECTOR CUSTOMS, LAHORE, 2009 PTD-LAHORE-HIGH-COURT-LAHORE 1860 (2009)

(a) Customs Act (IV of 1969)---

----Ss.15, 16 & 17---S.R.O.634(I)/2004, dated 22-7-2004--S.R.O. 734(I)/2005, dated 21-7-2005---S.R.O. 564(I)/2005, dated 6-6-2005---Constitution of Pakistan (1973), Art. 199---Constitutional petition---Import of a vehicle under general manifest dated 7-6-2005 and bill of entry dated 12-6-2005---Petitioner (Importer) declared the year of manufacture of vehicle to be 2003 and claimed its importability under Gift Scheme vide Import Policy ' Order 2004 published as S.R.O.634(I)/2004, dated 22-7-2004---Said Scheme/notification allowed the import of vehicles which were. not more than two years old---Authorities did not allow clearance of the imported vehicle and in due course referred verification of its year of manufacture, which finding disqualified the imported vehicle from the benefit of the Gift Scheme, resultantly petitioner's vehicle was not importable on 7-6-2005 and therefore, it became liable to be confiscated for violating the prohibition contained in Import Policy of 2004-2005 (S.R.O.634(I)/2004, dated 22-7-74)---Show-cause notice was issued by authorities to the petitioner--By, S.R.O.734(I)/2005, dated 21-7-2005, Government announced its Import Policy Order, 2005-2006 whereunder vehicles that were three years old rather than two years became importable under the Gift Scheme---Question arose whether in the circumstances, the petitioner was entitled to avail the enlarged concession given in the Import Policy Order, 2005-2006 and, therefore, to save the imported vehicle from confiscation"---Contention of the authorities was that beneficial S.R.O. could not operate retrospectively to reopen a past and closed transaction---Validity---Held, rule of past and closed transaction would apply when all proceedings on the question in issue, namely, importability of the petitioner's vehicle had concluded--In the present case, no proceedings had commenced on that question when the beneficial S.R.O. came into the field on 21-7-2005, not even the impugned show-cause notice dated 5-10-2005 had been issued to the petitioner thus, proceedings for the clearance of petitioner's imported vehicle still remained pending and could not be termed as being past and closed at the time when the beneficial dispensation under Import Policy Order 2005-2006 came into the field---Petitioner's imported vehicle arrived 18 days prior to the date of effectiveness of the beneficial S.R.O. viz. the Import Policy Order, 2005-2006 which enlarged the right to import vehicles under Gift Scheme; at the time of promulgation of said Policy Order, no action whatsoever had been taken by the authorities on their allegation of `non-importability' of the petitioner's vehicle---Issue of importability of the said vehicle was therefore, a case under process and a `pending proceedings' at the time---No clearance or charging order having been passed on or before 21-7-2005, the matter of importability of the said vehicle was not a `past and closed transaction' on the said date---Benefit of enlarged concession under Import Policy, 2005-2006 should be made available to the petitioner---Principles.

Collector of Customs Lahore and others v. Messrs World Traders C.A.No.1882-2002; Ellahi Cotton Mills Ltd. and others v. Federation of Pakistan and others PLD 1997 SC 587; Messrs Army Welfare Sugar Mills Ltd. and others v. Federation of Pakistan and others 1992 SCMR 1652 and Anoud Power Generation Limited and others v. Federation of Pakistan and others PLD 2001 SC 340 ref.

(b) Customs Act (IV of 1969)---

----Ss. 15, 16 & 17---Constitution of Pakistan (1973), Art.199---Constitutional jurisdiction of High Court---Scope---Constitutional petition calling into question the date of effectiveness of a statutory instrument---Constitutional jurisdiction constituted an appropriate remedy for the purpose---Principles.

Messrs Julian Hoshang Dinshaw Trust and others v. Income Tax Officer, Circle XVIII South Zone, Karachi and others 1992 SCMR 250 and Messrs Usmania Glass Sheet Factory Limited, Chittagong v. Sales Tax Officer, Chittagons PLD 1971 SC 250 ref.

Mian Abdul Ghaffar and Malik Muhammad Arshad for Petitioner.

Sultan Mahmood on behalf of Izharul Haque for Respondents.

ORDER

UMAR ATA BANDIAL, J.---The petitioner imported a vehicle under import general manifest dated 7-6-2005 and bill of entry dated 12-6-2005. He declared the year of its manufacture to be 2003 and claimed its importability under the Gift Scheme vide Import Policy Order, 2004 published as S.R.O. 634(I)/2004 dated 22-7-2004. This Notification allowed the import of vehicles that were not more than two years old. The respondents Nos. 1 to 3 ("respondent authorities") did not, however, allow clearance of the imported vehicle and in due course referred verification of its year of manufacture to the local agent of its manufacturer.

2. The manufacturer's agent informed the respondent customs authorities that the petitioner's imported vehicle was manufactured in 2002 and not in 2003. This finding disqualified the imported vehicle from the benefit of the aforesaid Gift Scheme. Resultantly, the petitioner's vehicle was not importable on 7-6-2005 and therefore it became liable to be confiscated for violating the prohibition contained in Import Policy Order 2004-2005. A show-cause notice dated 5-10-2005 to this effect was issued by the respondent authorities to the petitioner. The threatened action in the said notice is challenged in this petition.

3. By S.R.O. 734(I)/2005 dated 21-7-2005 the Federal Government announced its Import Policy Order 2005-2006 whereunder vehicles that were three years old rather than two years old became importable under the Gift Scheme. The only question arising for determination is whether in the circumstances of the case, the petitioner is entitled to avail the enlarged concession given in the Import Policy Order 2005-2006 and thereby to save his imported vehicle from confiscation.

4. The learned counsel for the petitioner submits the imported vehicle is liable to confiscation for violating the condition of age limit under S.R.O. No.634(I)/2004 dated 22-7-2004. Under S.R.O. 564(I)/ 2005 dated 6-6-2005 the redemption of seized vehicles on payment of fine/penalty is also prohibited. The petitioner' stands condemned and deprived of the benefit of the concession under the Import Policy Order 2005-2006 solely because his vehicle was imported 18 days prior to the date of enforcement of the said policy order. He adds that the customs authorities took cognizance of the matter for the first time on 5-10-2005 when the show-cause notice as to non-importability of the said vehicle was issued to the petitioner. By that date the Import Policy Order, 2005-2006 had already come into force and being beneficial in nature its concession ought to be extended retrospectively to the petitioner. He adds that the mandatory terms of S.R.O. 574(I)/2004 and the date of effectiveness of the Import Policy Order 2005-2006 render departmental remedies futile.

5. The learned counsel for the respondent authorities has objected the maintainability of the petition urging that departmental remedies are available against the impugned notice. He also contends that the Import Policy Order 2005-2006 cannot apply to import of goods made prior to the date of its enforcement/issuance on 21-7-2005. He opposes the retrospectivity of the said policy order on the strength of the judgment of the Honourable Supreme Court in C.A.No.1882-2002 titled Collector of Customs Lahore and others v. Messrs World Traders wherein it is opined that a beneficial S.R.O. cannot operate retrospectively to reopen a past and closed transaction. In this behalf he also relies on Ellahi Cotton Mills Ltd. and others v. Federation of Pakistan and others PLD 1997 SC 587.

6. The rule of past and closed transaction would apply when all proceedings on the question in issue, namely, importability of the petitioner's vehicle have concluded. In the present case no proceedings had commenced on that question when the beneficial SRO came into the field on 21-7-2005, not even the impugned show-cause notice dated 5-10-2005 had been issued to the petitioner. Thus the proceedings for the clearance of the petitioners imported vehicle still remain pending and cannot be termed as being past and closed at the time when the beneficial dispensation under the Import Policy Order, 2005-2006 came into the field.

7. The general principle of law settled by the Honourable Supreme Court in the Messrs Army Welfare Sugar Mills Ltd. and others v. Federation of Pakistan and others 1992 SCMR 1652 is to the effect that a beneficial or concessionary Notification or executive order may be given retrospective effect as it confers benefit and advantage on the assessee or citizen but a Notification or order that imposes new liability, obligation or burden on an assessee or citizen cannot be given such effect and must operate prospectively. One justification of this rule of retrospectivity of a beneficial Notification lies in the principle that a regulatory authority cannot whilst administering a law draw distinction between like parties in the enjoyment of a concession conferred by the State unless there is specific classification or exclusion in the Notification or as observed in the afore-noted case of Messrs World Traders, the relevant transaction is a past and closed one.

8. In the present case, the petitioner's imported vehicle arrived 18 days prior to the date of effectiveness of the beneficial Import Policy Order 2005-2006 which enlarged the right to import vehicles under the Gift Scheme. At the time of promulgation of the said Polity Order, no action whatsoever had been taken by the respondent authorities on their allegation as to non-importability of the petitioner's vehicle. The issue of importability of the said vehicle was therefore a case under process and a pending proceeding at the time. As no clearance or charging order of the said vehicle has been passed on or before 21-7-2005, therefore, the matter of importability of the said vehicle was not a past and closed transaction on the said date. The principle laid down by the Honourable Supreme Court in the Army Welfare Trust case (afore-referred) was affirmed in Anoud Power Generation Limited and others v. Federation of Pakistan and others PLD 2001 SC 340 in the following terms:

"At this juncture another important aspect of the retrospectivity of notification may also be noted that if the notification has been used for the benefit of the subject then it can be made operative retrospectively but if its operation is to the disadvantage of a party who is the subject of the Notification then it would operate prospectively. This point has been elaborately discussed by this court in the judgment pronounced in the case of Messrs Army Welfare Sugar Mills Limited and others 1992 SCMR 1652."

8. The circumstances of case, the stage of proceedings before the respondents and the contents of the relevant Notifications are such that based on the foregoing enunciation of law the benefit of the enlarged concession under Import Policy Order, 2005-2006 should be made available to the petitioner.

9. Reverting to the question of maintainability, the present petition calls into question the date of effectiveness of a statutory instrument. For such purpose, the writ jurisdiction constitutes an appropriate remedy. Reliance is placed on Messrs Julian Hoshang Dinshaw Trust and others v. Income Tax Officer, Circle XVIII South Zone, Karachi and others 1992 SCMR 250 which draws its rationale from Messrs Usmania Glass Sheet Factory Limited, Chittagong v. Sales Tax Officer, Chittagons PLD 1971 SC 250. Moreover, the declaration by the Court giving retrospective effect to the Import Policy,- 2005-2006 is not a relief that lies within the competence of the respondent authorities who are bound to implement SRO 634(I)/2004 in its strict terms. Therefore, for the said relief, the present petition represents a competent remedy. Petition allowed with no order as to costs.

M.B.A./S-171/L Petition allowed.